Intel Chips in for Linux Defense

Intel is among the companies bankrolling a new fund
to defend open source users from potential intellectual property lawsuits
brought by SCO Group.
The No. 1 chipmaker is putting its money behind Big Blue and an OSDL-backed fund to defend any suits related to the SCO/IBM dispute over Linux code.

The Santa Clara, Calif., chipmaker, along with IBM and a number of other vendors, has
given a total of $3 million to start the account, which will be overseen by
the Open Source Development Labs (OSDL), a
Beaverton, Ore., consortium promoting the growth of open source software.

Nelson Pratt, OSDL marketing director, told internetnews.com the
organization is still working out the specific protocols for companies
requesting funds in the event of a SCO lawsuit. What OSDL wants to avoid,
he said, is for the fund to become a clearinghouse for contract disputes and
license fees.

"We're not intending to make the threshold (for defense funds) high at all,
we're just intending to make sure the issues emanating from SCO are
contested in a court of law and -- once settled -- will have an impact
across the entire industry," he said.

When the SCO Group litigation is finally resolved, Pratt said, the defense
fund will be used to defray the court costs incurred against Linus Torvalds,
Linux kernel creator and OSDL Fellow, and other OSDL employees who were
subpoenaed by the SCO Group last year. If monies remain, the rest will go
into the organization's general fund.

SCO officials say they are not impressed with the creation of the legal fund
and vow to press forward with lawsuits next month. Blake Stowell, SCO Group
spokesperson, said the creation of a legal defense fund from multiple
companies doesn't change its plans, and it doesn't absolve the end user
from taking responsibility for copyright violations.

The Lindon, Utah, company, he told internetnews.com, still plans to
move forward with legal action against companies it feels have violated
SCO's copyrighted material. It will name the first batch by Feb. 17. The
company has yet to file suit against a single end user but did send 1,500
letters demanding companies pay a $700-per-server licensing fee or risk
litigation.

"Our company is still very much intent on bringing these end user lawsuits
to bear," he said.

While Intel is a founding member of the OSDL, and a regular contributor to
the open source movement, the company has been quiet about the controversy
until now. But many of Intel's customers, as well as Intel itself, have
received the SCO lawsuit letters and officials at the chip manufacturer
decided it was time to pitch in for a legal defense fund.

Chuck Mulloy, an Intel spokesperson, said officials at his company have
become increasingly concerned with SCO's decision to threaten lawsuit, and
then failing to show what Linux code is infringing.

"By refusing to disclose the basis for the claims, SCO Group is preventing
those individuals working on Linux from remedy," he told
internetnews.com. "It's a sense of fairness that concerns us; we
thought the appropriate thing to do was our fair share."

Mulloy said Intel, as a major member of the OSDL, felt it was better to
provide funds through an OSDL-led initiative, rather than taking the tack of
fellow OSDL board member HP. The Palo Alto, Calif., tech company announced
in September, 2003, its own indemnificat
ion policy when companies like IBM were reluctant to provide some legal
sanctuary to its customers.

"We're a member of OSDL; from our perspective we felt this was the right
approach," Mulloy said.

OSDL's goal is to boost the fund to $10 million through contributions from
individuals, companies and organizations.

"This fund sends a clear message that OSDL, in cooperation with others
throughout the Linux industry, will stand firm against legal threats levied
by The SCO Group," Stuart Cohen, CEO of OSDL said in a statement.

SCO has created a whirlwind of controversy by claiming the open source Linux operating system is an unauthorized derivative of its UNIX System V OS.

SCO is embroiled in a contract dispute with IBM, which has extended to the
entire Linux open source community. SCO claims Big Blue breached a contract
with the company by contributing unauthorized portions of its UNIX-based AIX OS code to the open source movement.

IBM denied the claims and countersued. A federal judge recently ruled that
SCO Group has 30 days to forward detailed information about its claims, a
key ruling expected to help advance the discovery in the case, which is
expected to go to trial in April of 2005. The deadline to back up its claims
is today.

The legal battle has inflamed many in the open source community, and the
attacks have only made matters worse. SCO CEO Darl McBride chastised open source leaders for not policing their own after an August "Denial of Service" attack brought down the company's site.

Despite legal maneuvers, SCO's claims have not slowed deployments of the
open source OS, a study being released this month has found.

Evan Bauer, a principal research fellow with Robert Frances Group, said a
just-completed survey the IT consulting firm conducted with 15 companies
about Linux deployments suggests that cost-savings and the General Public
License (GPL) are trumping concerns about SCO Group's claim
of copyright infringement within parts of Linux.

"None [of the companies surveyed] have concluded they're liable in
any way," he said in a recent interview with internetnews.com. The
survey asked companies whether the SCO lawsuit was impacting their
deployment plans.

About half of the companies in the survey, checked with their legal
departments about any potential exposure to the issue. For example, if a
court ruled in favor of SCO in finding that some parts of the Linux kernel
were copyrighted, would companies running Linux have to pay SCO license
fees?

"Many feel they are absolutely protected by the GPL," Bauer said.

The companies in the survey represented a cross-section of sectors, such as
manufacturing, retail, financial services, and universities.